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Thermolife International, LLC v. Myogenix Corp.

United States District Court, S.D. California

April 4, 2017



          Hon. Janis L. Sammartino United States District Judge.

         Presently before the Court is Defendant Vital Pharmaceuticals, Inc.'s Motion for Attorneys' Fees (“Vital Mot.”), (ECF No. 246, see also ECF No. 257), Defendant Hi-Tech Pharmaceuticals, Inc.'s Motion for Attorneys' Fees (“Hi-Tech Mot.”), (ECF No. 253), Plaintiffs The Board of Trustees of the Leland Stanford Junior University's and Thermolife International, LLC's Opposition to the Motion for Attorneys' Fees of Defendants Vital Pharmaceuticals, Inc. and Hi-Tech Pharmaceuticals, Inc. (“Pls.' Opp'n”), (ECF No. 267), Defendant Vital Pharmaceuticals, Inc.'s Reply in Response to Plaintiffs' Opposition to Motion for Attorneys' Fees (“Vital Reply”), (ECF No. 270), and Defendant Hi-Tech Pharmaceuticals, Inc.'s Reply in Support of Its Motion for Attorneys' Fees (“Hi-Tech Reply”), (ECF No. 271).

         This matter came before the Court for oral argument on February 9, 2017. (ECF No. 278.) At that time, the Court permitted Plaintiffs to file a second, late-filed Declaration in Support of Plaintiffs' Opposition, and also permitted Defendants the opportunity to file a Response. (See id.) Both parties have now so filed, and therefore also presently before the Court are Plaintiffs' late-filed Declaration in Support of Plaintiffs' Opposition to the Motions for Attorneys' Fees (“Suppl. Decl.”), (ECF No. 280), and Defendants' Joint Response to the Late Declaration (“Decl. Resp.”), (ECF No. 279).

         After considering the Parties' arguments and the law, the Court STRIKES the late-filed Declaration and GRANTS Defendants' Motions for Attorney Fees.


         Beginning in March 2013, Plaintiffs filed eighty-one related patent infringement lawsuits in this Court, including the instant case regarding Defendants Vital and Hi-Tech. (Vital Mot. 2:1-2.) The Court bifurcated the proceedings for purposes of invalidity, enforceability, and infringement and, with the consent of the parties, consolidated these actions up to and including trial on the invalidity of the patents in suit. (Mem. Decision and Order 2:14-16, ECF No. 245.) Vital, Hi-Tech, and GNC[1] proceeded to the invalidity trial phase, and after a five-day trial in August, the Court concluded that (1) claim 1 of the '459 Patent was invalid as anticipated; (2) claims 1, 4, 5, 7, 8, and 10 of the '872 Patent were invalid as obvious; (3) claims 1, 2, 3, 4, 5, 8, and 14 of the '006 Patent were invalid as obvious; and (4) claims 1, 2, and 6 of the '916 Patent were invalid as obvious. (Id. at 46:10- 13.) In short, on September 29, 2016, the Court found that all patents-in-suit were invalid, thereby concluding the litigation.

         Subsequently, Defendants Vital Pharmaceuticals, Inc. (“Vital”) and Hi-Tech Pharmaceuticals, Inc. (“Hi-Tech”) separately moved for attorney fees against Plaintiffs The Board of Trustees of the Leland Stanford Junior University and ThermoLife International, LLC (collectively “Plaintiffs”). Both Vital and Hi-Tech base their claims on 35 U.S.C. § 285, which enables the Court to award attorney fees in “exceptional cases.” (See generally Vital Mot.; Hi-Tech Mot.) Although both Vital and Hi-Tech argue that this case should be classified as “exceptional, ”-and therefore each defendant should be awarded attorney fees-for generally the same reasons, [2] each defendant presents additional arguments based on its own, specific products.

         Initially, the Court vacated the hearing and took the Fee Motions under submission without oral argument pursuant to Civil Local Rule 7.1(d). (ECF No. 274.) However, three days later, Hi-Tech filed a Motion for Oral Argument; Vital consented to the Motion and Plaintiffs opposed. (See ECF No. 275.) The Court granted Hi-Tech's Motion and held oral argument on the pending Fee Motions on February 9, 2017 at 2:30 p.m. (See ECF No. 276.) At the end of oral argument, Plaintiffs argued that Defendants presented-both in their Reply briefing and at oral argument-new lines of argument regarding their Motions for Attorney fees such that Plaintiffs should have a chance to submit a formal declaration in Response. (See ECF No. 278.) Defendants strongly objected; however, the Court tentatively permitted (1) Plaintiffs to file a supplemental declaration, and (2) Defendants to file a response both explaining more fully their position as to why the late-filed declaration should not be considered and responding to the substance of the declaration.

         Given these circumstances, the Court first addresses the late-filed Supplemental Declaration, and then moves to the substance of Defendants' Motions for Attorney Fees.


         At the February 9, 2017, oral argument-after the Court had made its tentative ruling and after Plaintiffs, Defendant Vital, and Defendant Hi-Tech had each orally argued the points they thought relevant to the dispute-Plaintiffs requested permission to file a supplemental declaration setting forth additional information about Plaintiffs' Counsel's pre-filing investigation. In particular, Defendant Hi-Tech during its forty-five-page presentation at oral argument several times specifically pointed to Plaintiffs' Counsel's inadequate pre-filing investigation, and thus Plaintiffs sought leave to file a supplemental declaration addressing that discrete issue. Defendants objected to the request, arguing that any supplemental declaration would be untimely and unduly prejudicial. To allow all parties to be fully heard on the request, the Court tentatively permitted Plaintiffs to file the Supplemental Declaration, but also allowed Defendants to file a Response in part more fully setting forth their arguments as to why the Court should not consider the Supplemental Declaration. Defendants' arguments in the subsequently filed Declaration Response now convince the Court that Plaintiffs' Supplemental Declaration should be stricken.

         As an initial matter, Plaintiffs at the time of their Opposition filing were unquestionably on notice that the adequacy of their pre-filing investigation was a central issue. (E.g., Vital Mot. 1 (entire factual section entitled “ThermoLife's Lack of Pre-Filling Investigation and Its Deficient Allegations”), 10 (entire analytical section entitled, in part, “ThermoLife's Failure to Conduct a Diligent Pre-Filing Investigation”).) And the adequacy of any pre-filing investigation necessarily implicates a plaintiff's counsel; an attorney may not blindly accept her client's statements or contentions but instead must conduct an independent investigation of the same. See generally, e.g., Federal Rule of Civil Procedure 11(b); (see also, e.g., Vital Mot. 12 (explicitly citing and discussing a case where “[t]he Federal Circuit found that the inquiry into [the defendant's] infringement performed by [the plaintiff's] counsel was not reasonable under Rule 11” (emphasis added))). Therefore, Plaintiffs should have responded in their Opposition to any deficiencies in Plaintiffs' Counsel's pre-filing investigation, especially given that Plaintiffs did, in fact, respond to the pre-filing-investigation argument generally. (Pls.' Opp'n 3 (entire section entitled, in part, “Plaintiffs' Pre-Filing Infringement Investigation Was More Than Adequate”)); Ultra-Temp Corp. v. Advanced Vacuum Sys., Inc., 194 F.R.D. 378, 383 (D. Mass. 2000) (“A litigant is under an obligation to present all relevant, material, non-cumulative evidence on point when opposing a motion.”). But Plaintiffs did not produce in their Opposition any evidence of their Counsel's pre-filing investigation. Nor did Plaintiffs after Defendants filed their Replies move the Court to file a Sur-Reply or a Supplemental Declaration. Then, when Defendant Hi-Tech requested oral argument on the Fee Motions Plaintiffs objected to the request. (Mot. for Oral Arg. On Hi-Tech Pharmaceuticals, Inc.'s Mot. for Att'y's Fees and Expenses 2, ECF No. 275.) It was only at oral argument, after all parties had already been given an opportunity to present any arguments they wished, that Plaintiffs requested permission to file the Supplemental Declaration here at issue. And to now consider the extensive Declaration when Plaintiffs “failed to present this evidence to the district court in opposition to the motion for summary judgment, either in [their] written briefs and affidavits or at the . . . hearing, ” United States v. Kitsap Physicians Serv., 314 F.3d 995, 999 (9th Cir. 2002), is simultaneously inappropriate and “unfair” both “to the movant” and “[o]ther litigants [who] could have that judicial time, ” Carmen v. S.F. Unified School Dist., 237 F.3d 1026, 1030-31 (9th Cir. 2001). See S.D. Cal. L.R. 7.1(f)(3)(b) (explaining that a party's “opposition must contain a brief and complete statement of all reasons in opposition to the position taken by the movant” (emphases added)).

         Further, Plaintiffs' Supplemental Declaration includes far more information (and even argument) than simply facts regarding Plaintiffs' Counsel's pre-filing investigation. For instance, the Supplemental Declaration has a Section devoted to addressing “Counsel's Involvement in ThermoLife's Licensing the Patents” at issue in this case. (Suppl. Decl. ¶¶ 7-8.) This information perhaps addresses Defendants' characterization of Plaintiff ThermoLife as a “patent troll”-another aspect of Defendants' Fee Motions-but does not speak at all to Counsel's pre-filing investigation. The Supplemental Declaration also exceeds the Court-permitted scope by addressing post-filing conduct. (Id. ¶¶ 14 (explaining infringement “analyses were revised, added to, and modified over time, including after the claim construction hearing in this matter”), 15 (discussing process of offering sublicenses after “product analyses were complete, ” including to parties who “were contacted only after litigations were filed but before they were served with the Complaint”).) And the Supplemental Declaration also exceeds the Court-permitted scope by arguing-for the first time-that in pre-filing Counsel “and ThermoLife” focused on the supposedly “key aspect[]” of “whether the advertising and labels disclosed the requisite intent of ‘improving vascular NO activity of the vascular system of a human host by enhancing endothelial NO[, ]' ” and that therefore “[p]roduct testing would not have been of assistance in finding such intent.” (Id. ¶ 16 (emphases added).)

         Defendants correctly respond that these additional statements and arguments will be unfairly prejudicial because they are “incompetent and incomplete.” (Decl. Resp. 9.) Specifically, Defendants have had no discovery regarding these recently added statements and arguments, some of which appear to directly conflict with the evidence previously before the Court. (Compare Suppl. Decl. ¶ 11, with Kramer Dep. 133:4-134:24, ECF No. 246.) And the Supplemental Declaration seems to selectively waive attorney-client privilege, (e.g., Suppl. Decl. ΒΆΒΆ 7, 11-14), thus likely making Counsel's general investigation ...

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